Time Warner considering 'me too' effect in Journal Broadcast blackout

Like sands through the hourglass on a soap opera Time Warner Cable doesn't carry locally, the blackout of NBC affiliate WTMJ-TV (Channel 4) on the pay-TV service is now in its 26th day.

A second Green Bay Packers preseason game was blacked out over the weekend.

It reportedly scored a rating of 15.1, comparable to the first preseason game, which was also blacked out. This is down about 4 to 6 rating points from last year.

A Spanish-language broadcast of the game earned a 2.3 rating on Telemundo. A local rating point is the equivalent of 9,100 homes.

And now the Journal Broadcast Group station is facing an existential crisis after losing its place in the cable universe when Time Warner put the Game Show Network on its dial location.

Dial location has become part of the negotiations, said Time Warner spokesman Michael Pedelty. Journal Broadcast "didn't see the value" of the dial position and chose to "abandon that shelf space," he said.

While both sides have been courting public opinion, "the vast majority of calls" to the Time Warner call center "are not about this issue." He would not say how many people have cancelled their subscriptions during the dispute, Pedelty said, "but customers leave every day."

"What we tell people ultimately is that the Journal Broadcast dispute is with us today. I don't know when their contract ends with Dish or DirecTV or AT&T, but I will tell you they will" be asking for an increase in fees from them as well, Pedelty said.

At issue in the dispute are the fees paid by pay-TV services to carry a station or channel's programming, as regulated by the Cable Act of 1992.

Time Warner said Journal Broadcast is asking for a 200% increase in fees. Journal Broadcast said the increase is pennies per subscriber. An industry analyst said that a typical fee for a market the size of Milwaukee is 50 to 60 cents per subscriber monthly.

Time Warner has about 400,000 subscribers in Wisconsin.

CBS-owned and -operated stations have been blacked out on Time Warner since Aug. 3, affecting more than 3 million subscribers. According to the New York Daily News, before talks broke down, Time Warner agreed to pay CBS $2 per customer, up from 50 cents in 2008.

Last year, WISN-TV (Channel 12) was blacked out for a week in a dispute between Time Warner and Hearst Broadcasting.

One issue at play in the CBS dispute are digital rights issues limiting a broadcaster's ability to redistribute its programming on broadband. The issue is reportedly also part of the dispute between Time Warner and Journal Broadcast.

Such blackouts are not isolated incidents but part of a growing pattern in the fight between stations attempting to recoup rising programming costs through retransmission consent fees, and the battle by pay-TV services to keep such costs from rising.

According to congressional testimony by a Time Warner executive, cited by Citizens Against Government Waste, the number of blackouts during retransmission disputes has increased from a dozen in 2010, to 51 in 2011, to 69 last year.

Last week, Journal Broadcast asked the consumer protection and antitrust unit of the Wisconsin attorney general's office to require Time Warner to fulfill its obligations under a state statute that requires "video program service providers" to compensate customers for service interruptions of more than four hours.

Pedelty called the request "disingenuous."

"We were right there when (the statute) was being crafted and we know the intent of the law," he said.

He said in an email that a response was sent to the attorney general's office explaining that the law cited is "for outages ... and not programming disputes."

Pedelty said Time Warner "is looking down the future" at the "me too" effect in such negotiations. If you give someone a 200% increase, what's to stop the next guy from asking for 220%, he said.

"We're taking a hard stand for our customers."

About Duane Dudek

Duane Dudek is a reporter and columnist covering radio and television. He also reviews movies.